CFTC bans fraudulent Chicago corn trader

CFTC bans fraudulent Chicago corn trader

The regulator found that on June 22, 2007, Neuman, a pit trader in CBoT corn options, engaged in unauthorised trading in the account of another corn options trader. He ignored instructions to limit risk and made unauthorised purchases of several thousand July 2007 corn futures contracts in a downward trending market.

He then attempted to hide his unauthorised trades from the account owner by misrepresenting the profits, losses and risks the account was incurring. Neuman altered trade data in a risk monitoring system used by the account owner to monitor his trading, and issued false statements to the account owner, who suffered about $4m of trading losses.

Most Popular